Reassurance in spite of falling uranium price: Wilson said sector fundamentals remained solid. Near-term uranium price indicators appeared to bottom in the third quarter of 2007 at $US70 a pound and now suggested a move in the spot price to $US90 a pound by early 2008 and up to $US120 a pound by late 2008. The long-term contract price had remained stable at $US95 a pound.

Increasing demand for uranium fuel: Current demand for uranium fuel from all sources approximated 81,600 tonnes a year. This was anticipated to increase to more than 96,000 tonnes a year by 2015. Primary drivers included increasing energy demand, global warming, competing energy price increases and security of energy supply.

Forecasts for short- and long-term prices: From a trading viewpoint, Grigor said price must be now getting near the bottom. But he said that with such a thin, volatile market it could range anywhere from $US60 to $US100 a pound as a spot price over the next 12 months. He considered that in five years the price of uranium would be between $US50 and $US60 a pound for long-term contracts. Grigor thought that should be looked at as a sustainable long-term price because at $US100-plus a pound, it would result in a host of new projects coming on stream that were low grade. Long term, if companies were going to be bringing a mine on-stream, they wanted to make sure they could make a profit at $US40 a pound, to be comfortable.

Forecast of $US120 a pound: Wilson said their forecast for the uranium price in 12 months’ time was $US120 a pound and $US60 a pound in three years’ time, reflecting the impact of new supply and reversion towards the industry’s long-term cost curve.

Uranium companies recommended to investors: Wilson said some of the Australian companies they held included Berkeley Resources, Uranex, Energy Metals and PepinNini Minerals, each a former or current client of Resource Capital Research. Grigor recommended Alliance Resources, which he thought was one of the better quality companies. Others not quite as advanced were Extract Resources and Contact Uranium.